Many
dictatorships create nationalized economies, or create
conditions where the free market cannot operate because
dictators tend to interfere with the rules of the free market,
impose new rules or even act outside the rules.

Most honest and well
intentioned politicians see the problems of the nation and
"think they know" of a solution. Often they become entangled
with a cause, or an ideology. In other cases they maintain their
own ideas. Unfortunately, almost without exception, they think
that the solution is to create new rules, or pass some legislation to solve a
specific problem.

Very seldom we hear of
politicians advocating the deletion of existing laws. Once
laws are "in the book", it is difficult to remove them. This is
called "progress": the type of "progress" measured by the
thousands of pages of restrictions, rules, laws, requirements,
establishment of Agencies, Boards and Commissions, and new taxes
on the people.

It
is so appealing for popular politicians to "think they know" how
to create jobs and help the poor, that they start believing in
their own solution: that somehow if they had absolute power they
would make the economy and the country better. Very often they become so
convincing that they are elected with large popular support.

Tyrants are not always evil. Joe Miller states:

"They are capable
of great good and small kindnesses. They smile, they laugh and
they love their children. But eventually they embrace the evil
which defines their tyranny, and then those who gave them their
power begin to pay a terrible price.

First a tyrant tells you he cares for you, then he presumes
to think for you, then he simply tells you what to do. This
is the essence of tyranny."

In spite of the best
intentions, once government is way bigger than the optimum, the
economic conditions start deteriorating. Eventually, when the economy fails, the most affected are
usually the jobless, the poor and the uneducated. Austerity
measures need to be put in place, even against the will of the
majority. People may be demonstrating in the street because they
have no jobs, no supplies, no food, but the people in power know
that there is no miracle solution and must continue with
austerity.

Here lies the fine line
between a well intentioned, popular politician and a statist
dictator. The people may try and elect different "personalities" of
leaders, until they eventually get stuck with a leader that will
not go away. This is how dictators or "presidents for life" came to power:
Stalin, Castro, Mao, Hitler, Mussolini, Gaddafi,
Chavez, Idi Amin, Milosevich, Saddam Hussein, they were all
loved by the people at first. As you can see from the pictures
on the side, almost every country in the world has tried a
statist "leader", a form of government centralization,
government nationalization, dictatorship or centralized power,
at one time or another in the not too distant past.

All of them suppressed
the economy (increased poverty) and reduced freedom. All of them
caused the people to struggle for survival. In some notorious
cases (Stalin, Mao, Kim Jong-il) people were reduced to mass
starvation.

No matter how many
countries experienced government centralization in its various
forms in the past and in the
present, it seems that people are always willing to vote for a
"strong personality", a "good speaker", a "leader" who is
willing to "do" something for them. They vote for the perception
they have of who this leader is, but how can this person "do"
something other than by imposing his views as laws?

Even the
most well intentioned laws are never flexible and good enough to
substitute the millions of constantly changing individual free
choices of the people; the millions of new ideas and ways people
can help each other through charity, local associations,
churches, and especially through the free exchange of goods in
mutually advantageous transactions. Only the two parties in a
free, unregulated transaction (without the "protection" of the
state) can maximize their mutual benefits: Either the
transaction is advantageous to both, or one of the two parties
will look somewhere else to find a competing product or service.

The government role in a
free market must be limited to the protection of life, property
and freedom.

Under a dictatorship the
national economy cannot express its full
potential. Most people and businesses enter a survival
mode, fending for themselves. People do not even feel selfish,
because the government is
there and it is expected to take care of the problems other
people have.

The restrictions and
rules put in place by dictatorial governments to "handle the
economy" are necessarily centralized. Dictatorships distrust
de-centralized decision making.

Cenralization (under any
form of government) is the antithesis of the free market. As we
just explained, the
free market works on the basis of millions of decisions taken by
the people, freely allowed to choose products and services
according to what they need or desire.

On the contrary, a
centralized government reduces the ability for the nation to
produce wealth every time it takes an economic decision "for" the people.
The image of a friendly government that does things for the
poeple needs to be constantly reinforced through propaganda.

Ironically, as the
economy gets worse, people are convinced that they need
even more government, to solve the increasing economic
problems! You can see this happening in countries, states and at
the local level (e.g.: Cuba, California, Detroit).

When the economy
continues to fail, jobs are scarce, people begin to seriously
suffer and are close to starvation and rebellion, only then a
change of attitude takes place. Most churches, lobby groups and
unions, who initially may have supported more government
programs (to help the economy, the poor, the seniors,
for a specific sector, for the environment, against racism, for
a minority group, for the underclasses and for every conceivable
cause), become the worst enemies
of the statist regimes. As a consequence dictatorial governments
either close down or take over, local associations, unions and
churches in an effort to quench all opposition.

When finally the
dictatorrship ends, many people still do not grasp the reasons
why the country was in such a bad shape. They understand that
dictatorships are bad and attribute the problems to the person,
the well intentioned politician who became a harsh dictator.

The irony is that the
well intentioned politician did the damage to the economy when
he was a well intentioned ideologist! Of course he had to constrain the
people later on, when the people reacted to a deteriorated
standard of living, the impositions of more rules, the austerity
regime and the loss of freedom.

Ironically again, some
people recognize the "good" that some dictators have done for
the country during their autoritarian regime. Even without a
strong economy on their side, and without the former popularity, some dictator never
lose their "good will" towards the people and the good of their
country.

Unfortunately most
dictators have added murder to injury. Not only they ruined the
economy and the well being of their country, but their
imposition of rules became ruthless. In some notorious cases,
this led to injustice, terror, and the death of millions of
people.How can we forget about the history of these "well
intentioed" people in so many countries?

Common to all centralized
regimes is the unwillingness to de-centralize economic
decisions:

- They do not allow the people the freedom to choose for
themselves what to buy, what to sell, how much to pay and how to
pay;

- do not allow employers to choose whom to hire, how much
to offer and what to expect;

- do not allow employees the
freedom to choose where to work and how many hours to work;

- do not allow the people to start their own small business in a
garage or in a basement, hire other people, buy and re-sell
products and create wealth;

When such free market
activities take place, centralized regimes intervene and quench
private initiative, usually in the name of "the law", "the
environment", "equality", "fairness" or some other good sounding
word.

In today's society we
have an information and education problem. People do not know
where to find good information (the truth) and often listen only
to the most accessible media. We also have schools run by
teachers who have been educated in those same schools.

Out of our information
and education systems, people have not yet been able to grasp
that a controlled economy will fail. Pretty amazing, after so
many examples!

So, what do we do in
"democratic" society? We
take the middle of the road approach: we allow our country's economy to be, at best, semi-controlled.
At best, this allows for a very limited economic expansion and a
meagre standard of living for the people.

This happens in two ways:
Government interference and unfair government competition.

Government
Interference

We allow our food to be
distributed privately (albeit with safety controls), but we
allow the government to take over the health insurance business.

We allow some industries
to invent, design, develop, produce and sell what they want, but
we allow the government to give tax "incentives" or increase
taxes to other specific industries (e.g.: solar, wind, car,
agriculture).

We allow food
production, but only under certain conditions.

We allow energy
production, but then we heavily tax their products.

We buy products from
abroad, but we deter industries from producing abroad. We want
industries to start up and crete jobs in our country, but we
deter them with corporate and employment taxes.

The examples abound. In
essence, we are not free from government interference in
economic decisions.

Unfair
Government Competition

The other way we have not
experienced the full benefits of a free market is because the
government has appropriated so much of it (products and
services) and competes unfairly with industry, in some cases
forcing private corporations to switch to another niche market
or go bankrupt.

The government can set
the rules of the game and change the rules when it wants:
Company ABCD may spend time and money in R&D for a truly
innovative product, but the government picks and choses (and
finances) the "winners", forcing company ABCD out of business.
Later it is discovered that the chosen "winner" is also
forced to go into bankruptcy.

The government can create
monopolies, for example in the utilities field.

The government can
provide "services" that by law must be bought from government
and charge an arbitrary fee for them, such as licences,
prescription drugs, or the money supply.

The government can pay
salaries that are not affordable by the private sector.

The government can impose
the use of a particular product on the general population (such
as smart meters, curly light bulbbs, etc.)

The government can set
the price for a particular product, or minimum wages.

The government can
provide its services without paying corporate taxes, but private
industries pay corporate taxes that go to government.

Finally, government
extract taxes from private industries and people to pay salaries
to their employees, including the tax portions that these
employees pay back... to the government!

In addition to government
interference and unfair competition, in recent decades we have
experienced an oversized government, as explained in the
main
section of this web site.

No country in the world
has ever experienced a truly free market. Isn't it time to try?